Fraudsters are coming for you but a binary options ban is not the answer! At least that is the stance of Canada’s Investment Industry Association, a non-regulatory body of Canada’s investment community. It’s not news that the binary options industry has been getting negative publicity and that some regulators worldwide decided to take it to the extremes. What is news is that Canadian authorities are now leaning towards banning binary options and the IIAC is taking a stand against it.
The Canadian AMF Says No to Short Term Trading
The Quebec AMF, a provincial regulatory body, being concerned over the increasing number of unlicensed brokers that have solicited Canadians, suggests that all options with expiries shorter than 30 days should be banned, along with any with an all-or-nothing payout, adding that “Binary Options platforms are like casino sites”. By applying this ban, AMF believes they could select which derivatives to authorize but how it will prohibit unlicensed brokers from scamming Canadiens is not clear. Source, Modaq.com.
Regulators Create a Binary Options Website and Song to Fight Scammers
The Canadian CSA, a nationwide regulatory body, created an informative website about the pitfalls of of binary options trading in order to educate but also scare potential investors from risking money. The website greets the visitors with the following message: “Why would you risk it? An all-or-nothing proposition that could take it all -and leave you with nothing.” The site discusses the various methods brokers can solicit potential clients either through email, cold calling or exaggerated ads. They also mention that no firms are registered in Canada to offer financial services and how to report fraud. In an interview with the CBC’s Shift New Brunswick, a member of the CSA had this to say about Binary Options: “I like to think of it as online gambling disguised as a financial product. It’s a wager of sorts.” Despite all the efforts, we are aware that multiple Binary Options brokers still operate in Canada – rendering Canada’s efforts to stop trading Binary Options useless. What we traders need to keep in mind is that the website portrays all binary options as scams and fraud and gives no credit to EU/CySEC or CFTC regulation.
I am Coming to Rip You Off – BCSC Sings to Warn Investors
While the CSA was working on their website the Canadian BCSC, another provincial regulatory body, created a video to share on social media. The title is: “Fraudster Crooner – A Fraud Warning Song”. According to resourceclips.com, this isn’t the first time the British Columbia Securities Commission creates a song to warn about fraudsters. Interviewing the BCSC director of communications and education, they could further add to the story that even though the song is entertaining, scams ruin life as in the case with a Toronto citizen’s suicide caused by massive loss to binary options scams.
Plan to Ban Binary Options Fails – IIAC Gives the Green Light!
The Plan to ban Binary Options fails as IIAC gives the green light! IIAC, Investment Industry Association of Canada, advocates against a ban on the BO industry and suggest it be allowed for firms registered with the IIROC, Investment Industry Regulatory Organization of Canada, and provincial agencies. According to Financefeeds.com, the Idea to lift the ban is not strange if we look at the ineffectiveness of a complete ban by studying examples like Italy’s Consob and the French AMF. They have both imposed an ineffective ban on unregulated brokers and advertising in general but they are both still plagued with fraud. The answer, at least according to the IIAC’s, is to allow IIROC regulated firms to operate under strict rules to save potential investors from dealing with scam firms and eliminate the risk of fraud. Source insurance-journal.ca.